Business transformation is a double-edged sword. Whilst it can be a great experience, it can also create a huge amount of stress and anxiety.
The reality is that the ability to constantly adapt and change is not a choice, it’s fundamental. To quote the late Jack Welch – “If the rate of change on the outside exceeds the rate of change on the inside, the end is near and the only question is when”
A business transformation can involve sweeping changes in structures, processes, and technologies that can leave an organisation barely recognisable. Such extensive changes bring an inevitable uncertainty, making the collective resilience and tolerance for risk vital to success.
It’s easy to forget that employees are the lifeblood of any organisation and therefore critical to the transformation’s success. Their psychological safety and well-being are paramount for good outcomes.
People need to feel safe enough to experiment and explore new avenues. Some might naturally withstand uncertainty better than others, but a lack of psychological safety can make even resilient people feel unsettled and therefore more likely to enter a fear state.
The Neuroscience of Fear
When fear overwhelms us, it triggers the release of stress hormones such as cortisol and adrenaline. This impair cognitive functions, leading to decreased flexibility, narrowed thinking, and heightened self-doubt. Whilst very useful for survival they are all detrimental for problem-solving and creative thinking.
Furthermore, fear activates the brain’s threat detection system, instigating a cautious and risk-averse mindset, exactly what you want to avoid during a transformative phase.
This can be further exacerbated when the organisational culture is generally perceived to be “unsafe”, for example where trust is generally low and / or the leadership approach emphasises control and lacks transparency.
Typically this is where you’ll see defensive behaviours creeping in, often disguised as something else, examples being:
“We’ve tried that before and it didn’t work”
“I don’t have enough time for this”
“We’ll let you know which bits of the change we’ll get on board with”
“It’ll never work in this business”
These are just a few of the many deflection mechanisms we can all use when we feel threatened by something. Our overriding drive is to protect ourselves and we’ll only experiment and innovate where we don’t feel threatened. Yet this fear state is prevalent in the majority of business transformations and a key reason for the poor performance statistics on business change.
Five Pillars for Fostering Psychological Safety
So, how can we enhance psychological safety during times of big organisational change? Here are a few examples of the low hanging fruit missed by many leaders in high change situations (and therefore where you can make a real difference):
Transparent Communication: Open and consistent dialogue is crucial. Make sure employees know why the transformation is needed, how it will unfold, and how it impacts them. Regular updates and open, two way communication channels are critical in building trust.
A common mistake is to avoid saying things for fear of saying the “wrong” thing. The problem with that the silence is far worse than an update explaining why something can’t be discussed in detail. We have an innate ability to pick up on gaps or things that are not being shared and that triggers our threat response. It’s so often the case that the story people make up (and share with colleagues) is far worse than the reality.
Empathy and Support: Try to understand and actively empathise with the anxieties your staff may experience. Show them through your actions that you are taking steps to alleviate their concerns as far as you can. Offer one-on-one meetings, coaching, and mentoring to create a supportive environment where fears can be openly discussed and mitigated.
Inclusive Decision-Making: We all like to feel we have some level of control over our destiny and when that’s not there we can quickly end up in a fear or defensive state, admittedly more quickly for some than others.
To offset that, ensure that employees feel they have a voice in decisions that affect them. This enhances their sense of psychological safety and increases their willingness to embrace change.
A good approach here is to be clear about which decisions are up for debate vs those that are not. For example the negotiating the specifics on how an outcome is achieved may be acceptable whilst debating whether it’s needed at all is not. Back to explaining why.
Continuous Learning and Development: Another trigger for people is where they feel they don’t have the necessary skills to adapt or won’t be able to acquire them. This can be especially the case where new technology is introduced and the team has been using the old technology for many years.
Demonstrate your commitment to ensuring the team will be able to gain the skills they need, taking into account the different ways people learn. Use a mix of different approaches such as workshops, online learning resources, peer groups, on the ground experts and other resources to help people upskill or reskill in ways that work best for them. Most of all encourage a growth mindset culture, whereby people feel safe to try something new and go outside their comfort zone, even if it doesn’t work first time.
Celebrate Small Wins: It’s so easy to miss this one in the constant pursuit of the bigger picture and yet it’s a huge motivator, especially where the change feels hard. Acknowledging even minor milestones can create a positive, motivating environment. It’s also an opportunity to reward and reinforce the right behaviours and showcase how different teams are adapting. Even better, allow teams to share their challenges and what they learnt from them, back to the growth mindset.
Failure
Just one point on the willingness of leaders to tolerate failure, in other words the recognition that failing is critical to succeeding and certainly to innovation and change. It is most certainly the case that failure is a career limiting endeavour in the majority of organisations, try it at your peril!
Some organisations, however, view failure very differently. Tom Watson at IBM certainly did when a salesman cost them a bid worth a million dollars. When the salesman explained what had happened and was about to hand over his resignation, Tom said to him (paraphrased) “Why would I fire you when I’ve just spent a million dollars training you?”.
Google and others include so called “failure days” where employees are expected to showcase something they tried and failed, most importantly what they learnt from the experience.
In 2015 Jeff Bezos wrote a letter to shareholders saying “One area where I think we are especially distinctive is failure. I believe we are the best place in the world to fail”. I think the results speak for themselves.
Final Thoughts
Transformations are, by definition, fraught with challenges and uncertainties. By prioritising psychological safety, leaders can cultivate an environment that encourages trust, collaboration, and innovation. In the long run, as proven by the most successful organisations, building a culture of trust and psychological safely will not only accelerate your current transformation but will also contribute to the ongoing sustainable growth and health of your organisation.
After all, the well-being of your employees is the well-being of your organisation.
